: Well, Prime Minister, thanks for attending this event once again. A passionate and optimistic speech. Now, my first question is, to coin a former PM’s phrase, are we in the per capita recession we had to have?
ANTHONY ALBANESE, PRIME MINISTER: If you look at the global economy, there’s nowhere you’d rather be, in my view, than Australia. If you look at our growth, it’s stronger than just about all the countries in the G7. Our employment growth, we’ve had 820,000 jobs created since we came to office. At the same time, as you’ve seen real wages grow, there have been international pressures. There are a number of countries that are in recession, we are not. And we need to, I think, not talk Australia down. My job is to seize the opportunities that are there. So, when I say that I’m optimistic, I mean it. And I mean it, not just in a speech, I mean it by how that translates into our Budget that we handed down on the 14th of May and how that shaped that view of the world and seizing those opportunities going forward can be shaped.
CLENNELL: But it was pretty anaemic growth there at 0.1 for the quarter. Is that what you actually deep down want to see and what the Reserve Bank wants to see? Because that’s the way inflation comes down and rates can be cut.
PRIME MINISTER: I want to see growth, but I make the point that I want an economy that works for people, not the other way around. So, you’ve got to look at what the impact is. We know that many Australians are doing it tough, but that’s why we designed in the Budget, and I think we, frankly, when you look at that figure, as Jim Chalmers said this week, I think we hit the sweet spot as close as you could. So, we have a range of support happening on July 1. When we made the changes to the tax cuts that we made earlier this year, that wasn’t universally welcomed by every paper in the country and every broadcaster in the country. It was the right thing to do. It’s the right thing to do because it’s providing that support when it’s needed. And that showed some foresight, I think, the fact that we did that.
CLENNELL: Yet that could lift inflation, couldn’t it, the way you redirected those tax cuts?
PRIME MINISTER: No, what it is doing, the combination of cost of living measures that we have, the tax cuts, the household relief that put bills down rather than handing out cash, the Fee-Free TAFE, the cheaper child care, all of these measures combined make a positive difference. And Treasury estimates, as I included in the speech, indicate that those cost of living measures will put downward pressure on inflation. The tax cuts, of course, were built in. We chose to not increase them. I think they were $106 billion before. They’re now $107 billion across the forward estimates. But they’re in a way that will provide more help to people who are doing it tough. And that was a difficult decision. That wasn’t something we came to lightly. That was a change in our position. But it was the right decision done for the right reasons. And I note that I don’t think there is anyone being critical of that decision now, which is quite remarkable given the significance of what it was. Where the Opposition said they’d roll it back. Then they called for an election to be called before they voted for it.
CLENNELL: Well, with the Budget being such a driver against inflation, you must still be expecting a rate cut this year.
PRIME MINISTER: Well, they’re decisions for the Reserve Bank.
CLENNELL: The Deputy Governor’s here.
PRIME MINISTER: I’ll leave that to the Deputy Governor to make an announcement. Look, our job is to look after fiscal policy and that is what we’ve done. And you can’t do more than produce two Budget surpluses. Not produce mugs, actually produce surpluses. We’ve done it. We turned a $78 billion deficit into a $22 billion surplus last year. It’s a hundred billion dollar turnaround. That’s a very significant achievement. And we managed to project another surplus, bit smaller this year. But we’ve improved the Budget bottom line by over $200 billion. And that, I think, is a decision including, we are, you know, an election will be held sometimes in the next year. And, you know, we didn’t, we have avoided what has happened in the past, which is money just being put out to try to buy political support.
CLENNELL: The 2.75 per cent inflation prediction in the Budget by the end of the year, was there much discussion about that? Did you question that prediction in the Budget process? Can we really get that lucky?
PRIME MINISTER: Well, what Treasury do is they look at all the decisions that are made and we put the Budget to bed a little bit before 14th of May. But we’ve worked through, we had longer meetings and more meetings of the ERC this year than we had in the lead up to last year’s Budget because the issues were more complex that we had to deal with. How do we deal with that challenge of providing cost of living support whilst at the same time wanting inflation to continue to moderate? And that was our objective. So, yes, we said no to a whole lot of submissions. There’s always more things that you would like to do, but those macroeconomic settings were an absolute priority and that showed through.
CLENNELL: Are you confident in the prediction? You didn’t look at that number and go, ‘Well, how does it get there? It’s been sticky for four or five months’.
PRIME MINISTER: No, well, they’re Treasury predictions, and they’re based as well on the policies that we’ve got in place. The fact that we know with some of the measures, for example, on energy, we know what the impact will be because it’s modelled on the system that we put up before. So, we had a decision over whether the energy price relief would go to people who were recipients of Commonwealth payments or everyone. Those were the two options, essentially, because of the way it’s designed. You weren’t about to give everyone’s tax data to the energy companies and the audience here will be relieved that that’s the case. So, we had to make that decision. We made the decision of assisting every household because that’s the most efficient way to do it. And that will have a moderating impact on inflation, as will the additional measures such as Fee Free TAFE and the measures that we have in universities and in other areas as well.
CLENNELL. So, you’d be shocked if there was a rate hike, wouldn’t you? From what you’re saying?
PRIME MINISTER: I don’t comment on the Reserve Bank, no matter how many times you try to get me to do so.
CLENNELL: What would that do to you politically.
PRIME MINISTER: Whether the Deputy Governor is here or not.
CLENNELL: What would that do to you politically if there was a rate hike?
PRIME MINISTER: They make those decisions independent of government, and I have no intention of interfering either with the Deputy Governor or the Governor. They’ll make those decisions in what they see as their interests. They look after monetary policy. What we’ve done is done our job. We’ve done our job of producing Budget surpluses in stark contrast to what we inherited. Bear that in mind. We inherited very low economic growth. We inherited inflation with a six in front of it. We inherited $78 billion of budget deficit, productivity going backwards for a long period of time, and low wage growth.
CLENNELL: If there’s no rate cut coming for the next few months, wouldn’t you be better off politically going to an election in November or December?
PRIME MINISTER: Good try, Andrew. I remember it’s not unprecedented for a Prime Minister to announce an election date well in advance. But that didn’t end all that well. We’ll announce an election when you see me in a car driving the very short distance, perhaps from The Lodge to Yarralumla.
CLENNELL: So, you don’t rule it out this year?
PRIME MINISTER: Well, what I suggest to you, Andrew, is that you sit outside 5 Adelaide Avenue.
CLENNELL: It’s pretty cold this time.
PRIME MINISTER: I’ll be back there this afternoon. I’m on the record as saying, for a long period of time, I’ll give the same answer to the same question, which is, I think three years is too short. I think governments should serve full terms. I support four year terms. It’s been put to referendums twice by the Labor Party, hasn’t been successful. I have no intention of putting it there again. I can’t do anything about that. But three years is too short as it is. So, my intention is to keep, I’m just focused on governing and getting it right.
CLENNELL: Why should Australians give you a second term?
PRIME MINISTER: Because we’ve been an effective government, because we’ve delivered a stronger economic position than the one we inherited. We’re dealing with inflationary challenges, we’re creating jobs, we’re dealing with the immediate challenges which are there in the economy. We’re also looking after social policy. We’re a government that governs for all Australians, including we have gender equity at the heart of our Government’s agenda, be it paid parental leave, ten days domestic and family violence leave, the gender pay gap being at a record low, cheaper child care.
CLENNELL: What are you offering, though? You’ve said to Caucus, ‘The Cabinet’s crafting an offer’. Can you give us any sort of hint at what that offer will be?
PRIME MINISTER: Well, there’ll be an election campaign that has a lot of offers in it and we’ll do that at the time. But we are continuing to roll out new policies that aren’t just about the immediate, but are also about the future. The Future Made in Australia agenda is how we set ourselves up. You know, working with the resources sector, who you’ll hear from today on, not just continuing to export our resources and provide that certainty, but how do you value add? How do you create more jobs? More growth in the regions and the suburbs? I got elected on a platform of not leaving people behind and not holding people back. We’re doing that by looking after people. The increase that we’ve had in JobSeeker of the increase in rent assistance, the increased support that we’ve had for people who are in need, including our economic settings, but also looking to aspiration. That’s what our engagement with business and new industries and new jobs is about, providing people with that aspiration. But the other thing that we’re doing as well is, our place in the world matters. We have repaired our international relationships. They were frankly bottomed out. Whether it be the relationships in the Pacific where the entry fee for being taken seriously in our region is taking climate change seriously. Whether it be our relationships in Europe, where we repaired the relationship with France. Our engagement with our traditional partners in the US and the UK. Dealing with the challenge of our relationship with China, where we said we’d cooperate where we can, we’ve done that, disagree where we must, we’ve done that. We’ve engaged in our national interests. The visit of Premier Li in a couple of weeks will be important there. That’s $20 billion of Australian exports have been returned. That’s jobs here. So, for industries like wine, meat processing, barley, that’s about Australian jobs and our national interest. And we’ve done that as well.
CLENNELL: When you talk to the Chinese leadership, do you see a war between China and Taiwan as avoidable? Do you see a war between China and the US as avoidable?
PRIME MINISTER: Of course, it has to be. We have to engage. We support the status quo and we continue to emphasise that. The consequences of war are catastrophic. We see that with Russia and Ukraine. We spoke about the economy and what’s happened. Global inflation. The impact of the Russian invasion of Ukraine has been catastrophic for Europe and for the globe. We see it in the Middle East. The consequences that are there for humanitarian concerns, but also the impact for our economy. A conflict in this region, where there is strategic competition, must be avoided. That’s why guardrails are important. We’ve played a role in making sure that you have military to military communication. The breakdown where you had not a single phone call from an Australian Minister, no engagement whatsoever, let alone meetings with our major trading partner during the term before I became Prime Minister, is not a good situation. Engagement matters.
CLENNELL: Let’s talk about energy, because it was a large part of your speech, you promised an energy transformation over the years. You talk about a renewable energy superpower. Kilometres and kilometres of transmission lines, thousands of kilometres, renewable energy to take over. But it’s true, it isn’t progressing as you want, is it? Probably 65 per cent renewable by 2030 has been modelled rather than your 82 per cent target. And we’re getting three and a half gigawatts a year of renewables at the moment, including solar power, when for your target you’d need six gigawatts a years. So, you’ve got a challenge there, haven’t you? You’re not meeting the promise that you gave.
PRIME MINISTER: Well, I don’t accept the figures that you’ve put forward. One of the things that happens with any infrastructure project, I know a bit about infrastructure. is it doesn’t go in a straight line, it ramps up. And that is one of the things that you will continue to see, that’s what happens, that’s just what any modelling will show you occurs. So if you look at for example, I gave the example of Liddell. Liddell Power Station, Josh Frydenberg, not the candidate for Kooyong, he used to stand up in Question Time day after day and speak about keeping Liddell open. It was never going to stay open. 14 coal fired power stations announced their closure under the former Government and not a single hole was dug on a new coal fired power station. That delay meant a delay in action and rollout of what was needed for the energy grid. But, now you’re seeing at Liddell the solar manufacturing plant which will emerge there as just one of the elements in that site that now Origin’s dealing with, will employ more people on that site than the former power station did.
CLENNELL: You could never see a situation where technology moves to the effect that you could see small modular reactors. I think Don Farrell was just in Singapore for a meeting, the IPEF, where they signed up to an energy agreement which talked about some countries developing small modular nuclear reactors.
PRIME MINISTER: They’re not there. They’re not there. And Australia, the International Energy Agency has made it very clear that whilst for some countries, nuclear power makes absolute sense, for Australia, because of the natural advantages that we have, and bear in mind, we have a range of advantages. One, we have everything that is in demand in the 21st century that will drive the economy. We have copper, vanadium, cobalt, lithium, nickel. We have the lot. We have all the critical minerals. And that’s what our production tax credits are about, driving that industry. So, that’s the first thing that you need. Second thing you need is that people will look for, how does manufacturing occur? Green hydrogen. The advantage that we have is space. You can’t have. I’ve met with various leaders from Japan and Korea in the last few weeks. They would love to have the space that we have. We can produce through green hydrogen, producing green metals. Because of the space that we have for the world. We have a comparative advantage in this country if we just have the ticker to seize it rather than be frightened of it. We don’t have a comparative advantage when it comes to nuclear. We have a disadvantage because we don’t have an industry and it would be more than a decade and a half before anything could happen. And in the meantime, what do you do to plug the energy gap when coal fired power stations close?
CLENNELL: We’re kind of out of time, but I’m going to crave everyone’s indulgence. I have two quick questions left. You went to Sydney University, studied economics. Right now, 46 per cent of Sydney University students are international students. We’ve seen this huge wave of net migration. Is that as you think it should be, or is international students swallowing up our universities?
PRIME MINISTER: Well, no. Look, I think that our education exports are really important. It’s an important industry for Australia. So, in the economic sense, the second benefit that happens, I’ve met Ministers from one of the people I went to uni with at Sydney Uni is now a senior person in the Malaysian Government. That’s a good thing. Those connections which are there. I think one of the really good things Julie Bishop did was bring back the Colombo Plan. That was really important as well. So, there’s an important international aspect to it. But of course, we need more university places, not less. And we need more for Australians. And we need, if you look at where the future job growth is, we need more Australians to either have a university degree or a TAFE degree. And that’s why Jason Clare who’s so passionate about this, will make an enormous difference. If you look at the opening up, using models that have been used at Newcastle Uni, for example, to provide essentially free uni for people from disadvantaged backgrounds to come through, it’s been incredibly successful.
CLENNELL: All right, Jason, clear on Sunday Agenda at 8am if anyone wants to watch. Now, John Howard famously. Finally, John Howard famously once said he would consider his future as PM at age 64. When I’m 64. He then reneged. Of course, you’re 61 now, provided you’re reelected. When would you consider retiring?
PRIME MINISTER: Gee, you’re very confident about the election, Andrew, is the premise of that question. I thank you for your support.
CLENNELL: I said providing.
PRIME MINISTER: I thank you for your support and the endorsement of Sky News. Don’t tell the people after six.
CLENNELL: You’re deflecting a bit PM.
PRIME MINISTER: So, I’m one of the youngest when I sit around a G20, it makes me feel pretty young. I still play in the Sydney Badge tennis comp when I can, when it’s not raining here in Sydney. Had the last couple of rounds washed out. You know, I’m enjoying the job and I don’t take anything for granted. I didn’t expect, I didn’t go into Parliament to be the Prime Minister. I cherish every single day the honour that I have and it is an incredible privilege that I have. It says something about this country, someone who didn’t expect, you know, anything like this. I didn’t have. One of the things about becoming leader of the Labor Party. I waited a while in 2013 before I nominated because I wondered, genuinely at that time, whether you had to have the destiny thing that some people have. You know, they went to school and they told people at uni or when they went to [inaudible] I’m going to lead one day, I never did that. You won’t find anyone who can say that I said that to them before 2013 when people asked me to run. I think that’s one of the things, frankly, that makes it possible to do the job as I do, because I’m not worried about what happens. I’m worried about doing the right thing and doing the best job that I can and I’ll continue to do it for a period of time and I’ll let you know when. Maybe I’ll go on Sky Agenda one Sunday morning to make an announcement after I make the announcement about the election date.
CLENNELL: Prime Minister, thank you. Please thank Prime Minister, Anthony Albanese.
